Friday, October 28, 2016

Main Street Columnist Bill McGurn on how the former president used his foundation as a vehicle for personal enrichment.

Hillary and Bill Clinton are asking for a third term in the White House, and voters who want to know what this portends should examine the 12-page memo written by a Clinton insider that was hacked and published Wednesday by WikiLeaks. This is the cold, hard reality of the Clinton political-business model.

Longtime Clinton aide Doug Band wrote the memo in 2011 to justify himself to lawyers at Simpson, Thacher & Bartlett who were reviewing his role and conducting a governance review of the Clinton Foundation at the insistence of Chelsea Clinton. In an email two weeks earlier, also published on WikiLeaks, Ms. Clinton said her father had been told that Mr. Band’s firm Teneo was “hustling” business at the Clinton Global Initiative, a regular gathering of the wealthy and powerful that is ostensibly about charitable activity.

Poor innocent Chelsea. Bill and Hillary must never have told her what business they’re in. If she had known, she would never have hired a blue-chip law firm to sweep through the hallways of the Clinton Foundation searching for conflicts of interest. Instead of questioning Mr. Band’s compensation, she would have pleaded with him never to reveal the particulars of his job in writing.

But she didn’t, and so Mr. Band went ahead and described the “unorthodox nature” of his work while emphasizing his determination to help “protect the 501(c)3 status of the Foundation.” That’s the part of the tax code that has allowed the Clinton Foundation to remain tax-exempt on the premise that it is dedicated to serving humanity.

Mr. Band graciously copied John Podesta, then adviser to the board, who would eventually become Hillary’s campaign chief. His helpful reply was to suggest that Mr. Band “strip the defensive stuff out” and later “go through the details and how they have helped WJC” [William Jefferson Clinton].

The Band memo reveals exactly what critics of the Clintons have long said: They make little distinction between the private and public aspects of their lives, between the pursuit of personal enrichment, the operation of a nonprofit, and participation in U.S. politics.

Mr. Band writes that he and his colleague Justin Cooper “have, for the past ten years, served as the primary contact and point of management for President Clinton’s activities—which span from political activity (e.g., campaigning on behalf of candidates for elected office), to business activity (e.g., providing advisory services to business entities with which he has a consulting arrangement), to Foundation activity.”

This excerpt and all the potential conflicts it describes, plus Chelsea’s warning about business “hustling” at foundation events, would seem more than ample cause to trigger an IRS audit of the foundation. For that matter, why aren’t the IRS and prosecutors already on the case? Any normal foundation has to keep records to show it is separating its nonprofit activity from any for-profit business.